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Introduction of the Medical Device Management Act



The Medical Device Management Act
 
The Medical Device Management Act (the "MDMA") was passed by the Legislative Yuan on December 13, 2019, and promulgated on January 15, 2020.  Before the MDMA came into force, medical devices had been regulated by the Pharmaceutical Affairs Act (the "PAA") alongside drugs.  Nonetheless, given the ingredient, R&D process, risk, usage and sales model of medical devices varying from those of drugs, it is not ideal for the PAA to cover all aspects.  The MDMA, which contains 85 articles in 9 chapters, provides a more robust management concerning the lifecycle and risk classification of medical devices, from pre-market management (e.g., manufacture and sales, registration and clinical trial) to post-market control and surveillance (e.g., advertising, safety monitoring, adverse incident reporting and safety assessment), as well as post-market investigation conducted by the competent authorities.  The highlights of the MDMA are as follows:
 
1.    Medical Device Design and Maintenance Providers Are Regulated by the MDMA
Medical device businesses are divided into manufacturers and distributors.  The medical device manufacturers include businesses engaging in manufacturing, packaging, labelling sterilizing and/or final examination of medical devices. The MDMA further covers medical device designers who launch the products in their own names. (Art. 10)
Medical device distributors, on the other hand, include businesses engaging in wholesaling, retailing, importing, exporting and/or rentals of medical devices. The maintenance providers are deemed distributors and shall register before conducting business. (Art. 11)
 
2.    Reinforcing Risk-Based Management of Medical Devices
2.1     Electronic Registration for Low-Risk Medical Devices . One shall file registration with and obtain marketing approval ("MA") from the Ministry of Health and Welfare ("MOHW") for manufacturing and importing medical devices.  However, to simplify the pre-market application process, certain low-risk medical devices are subject to electronic registration only, and to maintain the validity of registration, manufacturers shall file annual reports to the MOHW. (Art. 25 and 28)  The maximum period granted for the MA is 5 years, which may be extended for up to another five years before the expiration date. (Art. 27)
 
2.2     Regularizing Clinical Trials for Medical Devices .  Clinical trial institutions or sponsors shall obtain the MOHW's approval for conducting clinical trials.  Any adverse event during or after the trial should be reported to the MOHW within 7 days upon the clinical trial institutions' or sponsors' knowledge of such event. (Art. 37, 38 and 39)
 
2.3     Establishing Track-and-Trace System .  To trace and monitor products on the market, medical device businesses and healthcare institutions shall establish the track-and-trace system for medical devices classified by the MOHW as of a certain risk level. (Art. 19)
 
2.4     Establishing Quality Control and Distribution Management Systems . To ensure product safety, manufacturers shall establish quality control systems and may only manufacture medical devices after obtaining a manufacture license. (Art. 22) Distributors of certain medical devices, as announced by the MOHW, shall comply with the Regulations of Good Distribution Practice for Medical Devices and establish a good distribution system.  The wholesale, import and export of such medical devices also require a distribution license. (Art. 24)
 
2.5     Monitoring Product Safety .  To strengthen the management of high-risk medical devices, the MOHW may order medical device businesses to implement safety monitoring programs regarding certain medical devices in a given period.  Healthcare institutions shall provide information and assistance in this regard. (Art. 47) MA owners or registrants shall immediately report to the MOHW and take corrective and/or preventive measures upon discovering that the medical device may endanger human health. (Art. 48)
 
3.    Other Differences between the PAA and the MDMA
3.1     The validity term of medical device advertisements is extended from one year to three years. (Art. 43)
 
3.2     Previously, for medical devices limited to be used by healthcare professionals, the advertisement thereof shall only be published on academic medical journals.  Under the MDMA, such advertisements could also be published on medical professional-only communication tools or academic medical events. (Art. 44)
 
3.3     The census on medical device businesses shall be conducted at least once every two years under the MDMA, as opposed to the annual census under the PAA. (Art. 53)
 
4.    Criminal Liability
For violations of the MDMA, the violator may be subject to administrative dispositions from the competent authorities, such as fines, orders of improvement within a given period, suspension of business or revocation of licenses.  Moreover, criminal liabilities may be imposed on the following serious violations:
 
4.1     Any person who manufactures or imports medical devices that cause misdiagnoses or contain toxic, harmful substances that lead to serious health hazards may be subject to imprisonment up to five years, detention and/or a fine up to NT$50,000,000.  Any person who commits the aforementioned offense by negligence may be subject to imprisonment up to three years, detention and/or a fine up to NT$10,000,000. Any person who, knowing the medical devices to be defective, sells, supplies, transports, stores, intermediates, transfers or displays with the intent to sell such defective medical devices may be subject to imprisonment up to three years, detention and/or a fine up to NT$10,000,000; any person who commits the aforementioned offense by negligence may be subject to detention or a fine up to NT$1,000,000. (Art. 60)
 
4.2     Any person who, without authorization or as an infringement, makes use of the name, instructions or labels of its or other’s legitimate medical devices, may be subject to imprisonment up to five years, detention and/or a fine up to NT$20,000,000.  Any person who knowingly imports, sells, supplies, transfers, stores, intermediates, transfers or displays with intent to sell such medical devices may be subject to imprisonment up to two years, detention and/or a fine up to NT$10,000,000. (Art. 61)
 
4.3     Any person who manufactures or imports medical devices without obtaining any MA with the intent to sell or supply such medical devices, who shall apply for registration but fails to do so or does so by means of electronic registration, or who knowingly sells, supplies, transfers, stores, intermediates, transfers or displays with intent to sell such illegal medical devices, may be subject to imprisonment up to three years, detention and/or a fine up to NT$10,000,000. (Art. 62)
 
4.4     In the event that the violator committed the aforementioned criminal offenses while performing its duties as the representative, agent or employee of an entity or individual, such entity or individual may also be subject to a fine up to ten times the amount for each offense. (Art. 63)
 
Medical devises will be regulated by the MDMA after its promulgation. Nonetheless, more comprehensive rules and regulations are to be established by the competent authorities in order to thoroughly regulate medical devices and safeguard consumer rights and safety.

Lee and Li has a Medical and Pharmaceutical Practice Group specializing in medical laws. Should you have any further questions, please do not hesitate to contact us. 



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